by Sarah J.F. Braley, Loren G. Edelstein, Michael C. Lowe | April 01, 2014

Not many startups can claim a three-year sales growth of 24,830 percent. That startling statistic earned a second-place finish on Inc. magazine's Inc. 500 list last year, an annual ranking of America's fastest-growing private companies. In 2012, the six-year-old firm planned some 3,000 government meetings and events, with revenues hitting $49.6 million., headquartered in Dumfries, Va., is a small business (with just 23 employees at present) owned and founded by Stephen Davis and Paul Trapp with a simple goal: to eliminate the anxiety and frustration of researching, planning and executing conferences for clients.

It was an idea that co-founder and CEO Trapp, a service-disabled veteran, conceived when he was chief of recruiting for the Army National Guard. "At the time, I was a sales manager for 5,000 recruiters," he explains. "I was planning awards ceremonies, training programs, banquets, workshops. I had a staff of 14, and practically all they were doing was planning events. That wasn't their job description, it was just something that had to be done. And it just consumed them."

Trapp attempted to outsource the work to a meeting planning company with experience in government contracting. "There really wasn't anything just like that," he notes. "The government wants someone they hire to do all of the work, submit one invoice and wait 45 days to be paid -- and to front all of the costs."

Thus the idea for a business was born. "The company was established in 2006, and we did our first event in 2007," says Trapp. "I was still in the military until 2009 and running my company at night and weekends. I retired from the military in 2009 to do this full-time, and then it just went crazy."

Managing Muffingate
Business thrived, and FederalConference suddenly had 50 employees and was planning thousands of events each year. "We won the Inc. 500 in August 2013, and in October our entire operation came to a halt. As soon as the scandals hit -- GSA, Muffingate -- about four agencies that we do business with really took a huge hit, and that caused some knee-jerk reactions across the board. Senior leaders were very hesitant to put their signature on something. They didn't want to be on the front page of the Washington Post."

Business has since improved, says Trapp, but a lot has changed. One example: "For one agency, I used to do an annual conference for 800 people. Now I do four conferences of 200 for the same agency." All 800 still need that training, he says, but it's less likely to be questioned as four smaller meetings.

Random acts of kindness
His company's culture is designed around one key principle, says Trapp: "If we get it right with our employees first, then they'll get it right with our customers."

Years earlier, during a period of financial hardship, Trapp found an anonymous envelope in his mailbox, with a note that read, "You're a good man and you do good things. Please accept this gift." Inside was $1,000. Trapp never learned the identity of his benefactor, but he continues to pay it forward: Every year, each employee gets $1,000 to give to a charity of his choice. The recipients are invited to a breakfast where the checks are presented by employees.

"Spontaneous recognition" happens on a weekly basis during Bagel Friday, when headquarters employees gather in the conference room and others can join via videoconference. "Anyone in the company can recognize someone for an Act of Greatness or and Act of Kindness," says Trapp. A dozen envelopes are tacked to a pinboard. They might contain anything from a $25 gift certificate to a trip for eight to Las Vegas. Honorees pick an envelope at random, and can choose to trade with one another before they are opened.

"I've seen people give the envelope to someone else before even opening it," says Trapp. "Someone might be nominated and say, 'Thanks, but so-and-so really went above and beyond this week.' "

Then there's Employee of the Quarter. Everyone gets a company roster and selects three people who performed outstanding work over the past three months. When the results are tabulated, says Trapp, "We tell the winners, 'You've worked very hard to earn this recognition. For the next three months, we want you to relax a little bit when you're home.' Then we send a maid service to clean their house for the next three months." Those who don't want that service can opt for $750 in cash.

Poised to branch out
Going forward, Trapp says, "My goal is to work more toward strategic levels with the government side, and to go after the big long-term contracts." Many of the larger agencies are adopting a system that requires meetings to be outsourced to a single entity for multiyear business.

Another objective is to extend the firm's footprint beyond it's traditional bread and butter. "When we were doing such a high volume with the government, we essentially cried uncle," says Trapp. "We were doing 3,000 events per year and had to have at least three bids for every piece of business, so we needed 9,000 hotel quotes. Site-selection was daunting."

A relationship with third-party giant HelmsBriscoe was the answer. "We had an initial conversation in 2011, and we gave them all of our site-selection business," says Trapp. "Then we signed an agreement in 2013 to become an option for housing and registration solutions for HelmsBriscoe Clients under DavisTrapp, a subsidiary we created that works as a completely separate entity.

"Right now," Trapp Adds, "about 95 to 98 percent of what we do is federal government work. I expect in two to three years the DavisTrapp thing will be bigger than the government piece." - LOREN G. EDELSTEIN